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| Wednesday, 18 January 2012 - 23 Safar 1433 H |
 FRONT PAGE By Mohannad Sharawi Saudi Gazette JEDDAH — There has been an intense debate in the country since October this year when Adel Fakieh, Minister of Labor, announced that the government was considering capping the remittances of expatriates to their home countries. Details have been sketchy but the minister was quoted as saying that a proposal was being studied by the Labor Ministry and the Saudi Arabian Monetary Agency (SAMA), the country’s central bank. The government has raised the issue because it is concerned that the eight million foreign workers in the country are not spending the bulk of their incomes inside the Kingdom, which it says is hurting the Saudi economy. Remittances from Saudi Arabia to other countries last year were reportedly around SR100 billion. Fakieh added that the government also wants to ensure all remittances take place through legal banking channels. However, he announced no timeline or date for when new relevant legislation will be drafted and implemented. A number of Saudi economists and analysts have welcomed the minister’s suggestion arguing that monitoring the accounts of both Saudis and expatriates will protect the economy from illegal and uncontrolled remittances transferred abroad. Dr. Fahad Bin Juma’a, an economic adviser, said that the reported SR100 billion sent out of the country last year was a result of the country’s “underground economy”, which takes place outside official banking channels. “Many money transfers happen illegally, often in the form of commodities such as jewelry, or the illegal use of accounts at Saudi banks,” he said. Dr. Juma’a added that the proposal will allow the Ministry of Labor to update information on the deposits and salaries of workers. “Such controls will protect the rights of both the employer and the worker because all amounts will be accounted for through legal channels. The system also prevents people using some Saudi bank accounts for illegal expatriate remittances.” Abdul Wahab Abu Dahish, a Saudi economic researcher, concurred with this view. He said all shops should be compelled to have all their transactions through approved bank accounts. He stressed that the government must plug this leakage of cash from the country. “We have deficits in our non-oil budget. I admit that our general budget has been making surpluses since 2003 but at the same time there have been accumulated shortfalls in the non-oil sectors since 2002. This is clearly not sustainable for the Saudi Arabian economy,”Abu Dahish said. Ali Baselm, director of the transfer department of Al-Amoudi Exchange Company, disagrees with the proposal arguing that it will affect the financial freedom of workers, which he believes is one of the most important principles underlying the Saudi economy. He said that there should be no difference between Saudis and others in terms of economic and financial rights, which includes the flow and movement of individual funds, remittances and other financial transactions. “The labor market in the Kingdom is considered the best job market in the region because it offers various freedoms and advantages for workers which is seen in the annual transfers abroad of $26 billion.” “I support efforts to control illegal funds but I disagree with any measure to take away the financial freedom of workers,” he said. June Dimalanta, a Filipino expatriate working as a technician, said that all legitimate and legal financial transactions should not be controlled. Workers should be allowed to send their own money home to their families. “Although the total amount of remittances is huge, this is still lawful and is not greater than the value added to the Saudi economy by foreign labor, which in turns contributes to the national output of the Kingdom.” Adnan, a Jordanian engineer, said that he agreed with some form of control over illegal remittances, and added that it was still unclear what the ministry wants to do. “According to 2010 statistics, there are about 8.4 million foreign workers in the country, representing 31 percent of the entire population. A total of six million workers are employed in the private sector. This shows the extent to which foreign workers are contributing to the growth of the Saudi economy,” he said. “The Minister of Labor has not clearly outlined what is going to happen, whether it is a system to monitor all bank accounts of foreign workers and capping financial transfers, or whether it will be some form of legislative oversight to prevent violations of the country’s labor laws.” “Everyone knows that the Saudi market is packed with unauthorized workers. I would agree with a system that controls the financial benefits and illegal transfers of these workers,” he added. __ |
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Jeddah: 6760000
Jeddah: 6760000
